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KEENE CORP. v. UNITED STATES

July 31, 1984

KEENE CORPORATION, Plaintiff,
v.
UNITED STATES of America, Defendant



The opinion of the court was delivered by: PARKER

 BARRINGTON D. PARKER, District Judge:

 Over the past decade, thousands of asbestos workers have brought personal injury and wrongful death suits against the Keene Corporation, alleging harmful exposure to asbestos fibers contained in thermal insulation products manufactured or sold by a Keene affiliate. This lawsuit represents Keene's second attempt in a federal district court to obtain indemnification from the United States for the money Keene has expended in defending those lawsuits. Keene's first attempt, in a complaint filed in the Southern District of New York, was dismissed for lack of subject matter jurisdiction. Keene Corp. v. United States, No. 80 Civ. 401 (S.D.N.Y. Sept. 30, 1981), aff'd 700 F.2d 836 (2d Cir.), cert. denied, 464 U.S. 864, 104 S. Ct. 195, 78 L. Ed. 2d 171 (1983) (Keene I). *fn1" After the dismissal by the District Court in New York, but before the affirmance by the Second Circuit, Keene filed in this Court the present complaint (Keene II), *fn2" again seeking indemnification from the United States. The government has moved to dismiss this complaint too for lack of subject matter jurisdiction, Fed.R.Civ.P. 12(b)(1), and, in addition, on the grounds that the doctrines of res judicata, collateral estoppel and comity bar relitigation of Keene's cause of action.

 This Court grants the government's motion, and for the reasons stated below, holds that application of the doctrine of collateral estoppel mandates dismissal of Keene's complaint in its entirety.

 BACKGROUND

 To determine the preclusive effect of Keene I on this proceeding, it is first necessary to compare the complaints in each case with the purpose of ascertaining the extent of any overlap. What immediately becomes clear is that the two complaints are as similar as they can be without being absolutely identical. Keene simply copied most of its present complaint from the amended complaint *fn3" in Keene I, making only a few changes which, for the most part, are of absolutely no significance. The complaints' recitation of background facts are virtually indistinguishable, and though the amended complaint in Keene I was divided into 23 counts while Keene II's complaint is divided into 21 counts, they allege the same causes of action. Both complaints seek to recover in one lawsuit against the United States the money Keene has expended in thousands of asbestos-related lawsuits -- some resolved, some still in litigation -- brought against Keene by workers, many of them shipyard workers, exposed to asbestos fibers. Both complaints assert the same jurisdictional grounds: 28 U.S.C. § 1331 (federal question); Federal Tort Claims Act (FTCA), 28 U.S.C. §§ 1346(b) and 2671-80; 28 U.S.C. § 1333 (admiralty jurisdiction); Suits in Admiralty Act, 46 U.S.C. §§ 741-52; Extension of Admiralty Jurisdiction Act, 46 U.S.C. § 740; and the Public Vessels Act, 46 U.S.C. §§ 781-90. Both complaints sound in negligence, breach of warranty, *fn4" strict liability and unjust enrichment. See Keene I, 700 F.2d at 839. Both complaints list a wide variety of governmental roles that allegedly connect the government sufficiently with the asbestos products so as to render it liable under the doctrines of indemnification, contribution and apportionment for all damages that Keene has sustained as a result of the lawsuits brought by the thousands of complainants. For example, the complaints allege that the government purchased from Keene asbestos-laden products; sold such products to Keene; promulgated health regulations relating to those products; failed to disclose its superior knowledge of asbestos' dangers; and specified the use of asbestos in products manufactured pursuant to government contracts.

 The complaints are similar not only in what they do contain, but also in what they do not contain. Both complaints fail to provide the factual background for each individual underlying claim against Keene, or to connect each underlying claim to a specific theory that would render the government liable. Instead they speak in the aggregate of "most," "some" or "a majority of" the claims. The Second Circuit described in great detail the contents and inadequacies of the Keene I complaint filed there, 700 F.2d at 838-40. Because the complaints are so very similar, the Court here need not repeat that recitation in describing the current complaint.

 Only two differences between the complaints are worthy of note. First, in Keene I plaintiff alleged in the amended complaint the existence of more than 6,000 underlying lawsuits, and sought judgment "in an amount presently unknown but which is believed to be in excess of $20 million" for any amounts "which have been, or which may be, recovered by Keene." *fn5" In contrast the present complaint, filed a year and a half later, alleges the existence of a much larger number of lawsuits -- 13,000 *fn6" -- but seeks judgment in the seemingly more precise, lesser amount of $14,788,850, without mention of any future sums.

 Second, the complaints, when asserting the causes of action arising under the FTCA, refer to different administrative notices of claim. Under the FTCA, before filing a suit for damages against the United States, a claimant must first file an administrative claim with the appropriate federal agency, to which the agency must then respond within six months. 28 U.S.C. § 2675(a). The amended complaint in Keene I was predicated on an amended notice of claim submitted in January 1979 to eight federal agencies in October 1981. Like the complaints, the two administrative notices of claim differ in terms of the number of lawsuits described and the damages sought. Importantly, they differ not only from each other but also from their respective complaints. Thus in Keene I, where the amended complaint, filed February 26, 1981, alleged 6,000 lawsuits and sought over $20 million, the notice of claim (filed two years previously) alleged roughly 1,000 lawsuits *fn7" and sought $1,088,135 and "an additional amount yet to be ascertained." By way of contrast, in Keene II, where the complaint, filed July 28, 1982, alleges 13,000 lawsuits and seeks $14,878,850, the notice of claim (filed about 10 months earlier) lists 9,822 lawsuits, *fn8" while matching the complaint exactly in terms of the amount sought $14,878,850.

 Aside from the number of lawsuits and the sums claimed, the administrative notices of claim are very similar, almost as similar to each other as the complaints are to one another. Both claim notices consist of page after page of computer printout, and provide in the printout one line of information for each underlying lawsuit: name of action (sometimes, in cases involving more than one plaintiff, listing only one plaintiff by name, with the rest of the plaintiffs subsumed under the appellation " et al."), the jurisdiction, the date complaint was served, the amount of general and punitive damages alleged in the complaint, the case number and court, and the amount of settlement, if any. Like the complaints, the notices fail to link any of the claims to one or another of the theories of liability. See Keene I, 700 F.2d at 840-41. The only other difference between the notices -- apart from numbers and sums -- lies in the additional schedules appended to Keene II's notice of claim, where Keene lists its insurance carriers and the amounts of its deductibles on its policies, and provides documentation of monies paid in settlements and judgments. In all other respects, the notices of claim are the same.

 ANALYSIS

 The government, in moving to dismiss, points to the obvious similarity between the two complaints and therefore seeks to dismiss the present complaint under the doctrine of res judicata, collateral estoppel and comity. Alternatively, should this Court hold those doctrines inapplicable, the government argues that this Court should dismiss for lack of subject matter jurisdiction, for the same reasons that the courts in Keene I dismissed the complaint there.

 In opposing the government's motion, the plaintiff argues that for a number of reasons this complaint should not be dismissed despite its similarity to the Keene I complaint. First, with respect to the FTCA claims, Keene contends that in contrast to Keene I, here the government waived its right to object to the sufficiency of the 1981 notice of claim by failing to take any action within the six months prescribed by 28 U.S.C. § 2675(a). Second, Keene contends that its complaint is not barred by res judicata, collateral estoppel or comity, since the dismissal in Keene I on jurisdictional grounds does not preclude Keene from remedying the jurisdictional defects so that it may be heard on the merits. Lastly, Keene argues that there exists subject matter jurisdiction under the FTCA and the various admiralty statutes.

 A.

 Waiver and the FTCA

 For a plaintiff to assert a tort claim against the federal government under the FTCA, a threshold requirement is the filing of a proper administrative claim. Further, the FTCA claimant may not file suit in district court until his administrative claim "shall have been finally denied by the agency." 28 U.S.C. § 2675(a). However, section 2675(a) then adds that under certain circumstances, failure of an agency to dispose of the claim constitutes denial:

 
The failure of an agency to make final disposition of a claim within six months after it is filed shall, at the option of the claimant any time thereafter, be deemed a final ...

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